How Fraud Hurts Medicaid

AURORA, CO - MARCH 27: Pharmacy director Hank Wedemeyer prepares to fill a prescription at a community health center on March 27, 2012 in Aurora, Colorado. The center, called the Metro Community Provider Network, has received some 6,000 more Medicaid eligable patients since the healthcare reform law was passed in 2010. Expansion of such clinics nationwide is considered key to serving the millions more patients set to be be covered by Medicaid if the healthcare reform passes the current challenge in the Supreme Court. Preventative health services and treatments at community health centers are also designed to reduce emergency room expenditures, which are up to 10 times more costly. Photo by John Moore/Getty Images

Yesterday night, the House passed the budget blueprint to fund Trump’s agenda in a huge win for Speaker Mike Johnson. All Republicans except Rep. Thomas Massie voted for the plan that will kickstart the process of passing “one, beautiful bill” to fund tax cuts, border and energy policies, and raise the debt ceiling. Read more here. 

The United States spent more than $1.8 trillion on Medicare, Medicaid, and other health programs in 2023. 

Some lawmakers want to cut Medicaid, but President Donald Trump has said there will be no alterations to Medicaid—or Medicare and Social Security—except to root out fraud.

“We estimated that the federal government could lose between $233 billion and $521 billion annually to fraud,” the Government Accountability Office reported.

One state lost an estimated $2 billion to Medicaid fraud over the past five years, a staff member in that state’s attorney general’s office told The Epoch Times.

“They were preying on individuals who were in need of behavioral health services,” the staff member told The Epoch Times. 

Prescription drug kickback schemes are also common. 

Mississippi, along with 37 other states and Puerto Rico, reached a settlement in an alleged kickback scheme involving Biohaven Pharmaceutical Holding Company Ltd., a wholly-owned subsidiary of Pfizer, Inc. 

Hospice fraud is another common scheme, The Epoch Times has learned.  Patients are enrolled in a hospice program without their knowledge. When the benefit runs out, the patient’s billing is moved to another “hospice” owned by the same provider.

Medicaid Fraud Control Units (MFCUs) recovered $1.2 billion in 2023, which made a return of $3.35 for every dollar spent. Investigators say they could do much more if more resources were available.

Fraud enforcement won’t be entirely successful in the public sector until the public payment system is run more like a private company, a staff member for a southern state’s attorney general told The Epoch Times. 

“The more you act like it’s your own business and it’s your own money, the more successful you’re going to be.”

The Medicaid program suffers from fraud and waste, but the real victims are the beneficiaries, investigators say. 

“You’re protecting government funds, but you’re also protecting the people who rely on the care to be provided,” an attorney working for an MCFU told The Epoch Times.

“The Trump administration is committed to protecting Medicaid while slashing the waste, fraud, and abuse within the program—reforms that will increase efficiency and improve care for beneficiaries,” a White House staffer told The Epoch Times.

BOOKMARKS

U.S. District Judge Amir H. Ali has given Donald Trump’s administration two days to comply with his previous order to unfreeze foreign aid funding. The president issued a 90-day blanket halt on foreign aid in the first weeks of his term, while officials examined spending plans to ensure they aligned with U.S. interests.  

The Social Security Administration has announced that it will axe its Office of Transformation, describing it as a “wasteful department.” “This redundant office was created under the previous administration and we are righting that wrong,” acting Social Security Commissioner Lee Dudek said in a statement.

District Judge Jamal N. Whitehead has issued a temporary block on Trump’s plan to pause refugee resettlement programs, saying the president had overstepped his authority. “To be sure, the president has substantial discretion ... to suspend refugee admissions, but that authority is not limitless,” he said.

The White House Correspondents’ Association will no longer decide who has close, press pool access to Trump, White House press secretary Karoline Leavitt said on Feb. 25. The announcement comes one day after a federal judge refused to force the Trump administration to allow the Associated Press back into the exclusive, 13-person team of journalists. 

Food delivery app DoorDash was forced to settle for nearly $17 million after it was revealed that it was using customer tips to subsidize driver wages from 2017 to 2019. The company had guaranteed its drivers a base wage for each delivery, but was using their tips to fill in the pay gap.

—Stacy Robinson